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Oilily Coloring Outside the Lines

NEW YORK — Even before spring arrives, Netherlands-based Oilily hopes to add a splash of color to a tundra-like fragrance market by expanding distribution of its youth-oriented scents outside its network of 42 freestanding doors in the...

NEW YORK — Even before spring arrives, Netherlands-based Oilily hopes to add a splash of color to a tundra-like fragrance market by expanding distribution of its youth-oriented scents outside its network of 42 freestanding doors in the U.S.

Best known for its vividly-colored children’s and women’s sportswear, Oilily has taken the first steps toward U.S. wholesale distribution of its nonfashion businesses — especially its 10-year-old beauty business, which represents 70 percent of the company’s total sales. Oilily’s parent, Olly’s BV, signed New York-based Kraft International Marketing over the summer to handle distribution of Oilily collections that include beauty, accessories, stationery, hair accessories and watches in the U.S., Canada, South America and the Caribbean.

The brand’s development in the U.S. and Canada will be led by Sue Phillips, Kraft’s newly appointed managing director for those markets. The Kraft venture represents a big step for Oilily, which, since coming to the U.S. in 1978, has traditionally preferred to keep its own tabs on operations here. But, “after 40 years, our story is just beginning,” Geert Olsthoorn, head of Oilily’s special projects group, said of the union with Kraft and the company’s anniversary. Oilily will continue to oversee its U.S. fashion operation, which will remain contained within its own stores here.

Kraft is in the final stages of nailing down upscale U.S. specialty and department store accounts for Oilily beauty. Zack Baron, Kraft’s president, expects to begin signing deals within weeks. He is aiming to establish a limited distribution network of fewer than 300 doors in the first year. Both shop-in-shop and counter concepts are planned for these locations, depending on individual retail accommodations, Baron said.

Oilily had retail sales of about $150 million in the U.S. last year, a number that represents roughly half the worldwide figure. Industry sources estimate that the U.S. wholesale expansion plan has the potential to grow sales by about 10 percent in the first year.

Kraft is handling roughly 20 beauty stockkeeping units, which are segmented into three fragrance collections: Oilily Classic, Blue Crystal and Orange Stripes. The assortment — ranging in price from $5 to $34 —contains eaux de parfum, eaux de toilette, body lotions and washes and lip balms. Products are designed mainly for youths, but Oilily sees those in relatively older age ranges — from teens to young adults to adult women — as part of its beauty customer base, said Phillips. Olsthoorn, whose parents founded the company with children’s wear, noted that the women who donned large sizes of Oilily kid’s apparel originally inspired the company to get into women’s wear.

Olly’s international plans for Oilily call for slow expansion of both freestanding store and wholesale operations. This includes its big European markets like Benelux, Germany, Spain and France, as well as Asia, where Korea represents $40 million in retail sales of Oilily. “The U.S. is the epicenter and the shockwaves will hit elsewhere,” Baron remarked.